Long Term Care continued
Required provisions (minimum standards)
All long-term care policies must provide coverage for at least one type of lower level of care, as well as coverage for care in a nursing home. Benefits for all lower levels of care must provide a level of benefits at least 50% of the benefits provided for nursing home coverage (i.e., if the nursing home benefit amount if $100 per day, then the required lower level of care benefit amount must be at least $50 per day). For the purposes of this rule, "lower level(s) of care" means the following:
- Nursing service
- Assisted living facility
- Home health services
- Adult day care center
- Adult foster home
- Community care for the elderly
- Personal care and social services
Riders and endorsements
All riders or endorsements added to an individual long-term care insurance policy after the date of issue that reduce or eliminate benefits in the policy must require signed acceptance by the individual insured. After the date of policy issue, any rider or endorsement that increases benefits with a corresponding increase in premium during the policy term must be agreed to in writing and signed by the insured, except if the increased benefits are required by law.
Other provisions
Group long-term care
The sponsoring policyholder (or employer) of a group long-term care policy is not required to contribute to premiums; but if the employer does contribute any premium, all members of the group, must be declared eligible and acceptable to the insurer at the time the policy is issued. A certificate must include descriptions of benefits and exclusions, the person insured and/or to whom benefits are payable, group contract number, certificate number and effective date.
Group long-term care continuation or conversion
Continuation of coverage means that the individual worker who was insured under the group long term care plan would be allowed to continue coverage under that group plan after employment has terminated. At that point, the employee would pay all the premium alone and would have to pay the premium to maintain coverage.
Group long-term care policies must give covered workers a conversion privilege who have been covered under the group plan for at least six months immediately prior to termination. No evidence of individual insurability is required. Rules of conversion will be the same as in the past:
- The individual will be covered by the same insurer.
- The premium will increase under the individual coverage.
- The conversion can not be denied (within 31 days of termination).
The first premium due, if any, must be paid not later than 31 days after termination of coverage under the group policy. The premium for the converted policy must be calculated on the basis of the insured's age and risk class at inception of coverage under the group policy from which conversion is made (but not the individual's health issues).
Terminology
Note: Most of this is common sense, but be sure to know the terms that have asterisks (***).
Long-term care insurance policy means any insurance policy or rider designed to provide coverage for one or more necessary or medically necessary services provided in a setting other than an acute care unit of a hospital.
******Chronically ill means a physician has certified the person as:
- unable to perform, without substantial assistance, at least two activities of daily living for at least 90 days due to a loss of functional capacity; or
- requiring substantial supervision for health and safety due to sever cognitive impairment.
******Cognitive impairment means loss of a person's short-term or long-term memory, orientation as to place and time, or judgment as it relates to safety awareness.
Qualified long-term care services means necessary diagnostic, preventive, curing, treating, mitigating, and rehabilitative services, and maintenance or personal care services that are required by a chronically ill individual.
Adult day care center means a social and health-related services program for six or more individuals provided in a community group setting.
Home health services means medical and non-medical services provided to persons in their residences including homemaker services, assistance with activities of daily living, and respite care services.
Nursing home facility means any facility that provides services for the care and comfort of individuals.
Personal care means the provision of hands-on services to assist an individual with activities of daily living.
Waiting period or probationary period means that period of time that follows the date a person is initially insured before the coverage of the policy must become effective as to that person.
